Energy Futures

NYMEX Crude Oil Futures

Crude oil is one of the better commodities to trade. It is a very active market and it is well-known with investors around the world. There is usually no shortage of news to cause the price of oil to move from day-to-day. This presents many good trading opportunities, whether you focus on day trading futures or you are a longer-term trader or investor.

Crude oil can be a volatile market. Major news events can happen overnight that cause the price of oil to have wide swings.

The energy commodities are some of the most active and popular commodities to trade. Crude oil is the most popular contract, but unleaded gas now known as RBOB, heating oil and natural gas are also very popular. They all offer great trading opportunities throughout the year, especially during certain seasonal times.

Trading the Energy Markets

Look around you. Whether you’re talking about oil companies, transportation or items we use every day, the energy markets have a direct impact on our lives and economies of every country. Arguably, energy markets are more interconnected to other asset classes and influential than any other commodity market, which is why, every day, all eyes on are crude oil, natural gas, gasoline, jet fuel, coal and other energies traded.

These markets are volatile – and can be sparked by geopolitical events that can happen just about anywhere energy is produced, transported or consumed. Weather and seasonality can play a major role in price spikes, or price drops. Investors who learn the fundamentals of the energy markets can find opportunities that span asset classes and help diversify a portfolio. Energy futures and options contracts offer investors a chance to take a position in these markets, or hedge their positions.

Light Sweet Crude Oil (WTI) futures and options are the world's most actively traded energy product. Customers around the world have sought out WTI futures for price discovery and risk management for more than 25 years. Here is why:

Key Facts about NYMEX Light Sweet Crude Oil

Most Liquid: WTI is the deepest and most liquid global energy benchmark, trading nearly 850,000 futures and options contracts daily.

Open Interest: Total open interest in WTI has exceeded 3 million lots, equivalent to more than 3 billion barrels.

Increased Access and Production: This year's 7 percent annual growth, the largest single-year gain since 1951, is driven by improved infrastructure and technology as well as procurement of oil from ample shale basins. Production of supply from the Mid-Continent, Bakken, and Canadian oil fields is expected to continue to rise.

Most Transparency: WTI's superior transparency and convergence to the physical market enables investors to make sound judgments on the basis of accurate weekly supply and demand information.

Efficient Margining: CME Group offers margin erosion and has the most WTI and Brent offsets

New York Harbor RBOB Gasoline

New York Harbor RBOB Gasoline conforms to industry standards for reformulated regular gasoline blend stock for blending with 10% denatured fuel ethanol (92% purity) as listed by the Colonial Pipeline for fungible F grade for sales in New York and New Jersey. RBOB is a wholesale non-oxygenated blend stock traded in the New York Harbor barge market that is ready for the addition of 10% ethanol at the truck rack.

Henry Hub Natural Gas (NG) Futures

Henry Hub Natural Gas (NG) Futures allow market participants significant hedging activity to manage risk in the highly volatile natural gas price, which is driven by weather-related demand. They also provide efficient transactions in and out of positions. Natural gas futures are: The third-largest physical commodity futures contract in the world by volume. Widely used as a national benchmark price for natural gas, this continues to grow as a global and U.S. energy source.

NY Harbor ULSD (HO) futures

NY Harbor ULSD (HO) futures are an outright heating oil contract between a buyer and a seller. The contract: Is based on what is also known as No. 2 fuel oil, which accounts for about ¼ of the yield of a barrel of crude, the second largest "cut" after gasoline Is used to hedge diesel fuel and jet fuel, both of which trade in the cash market at an often stable premium to heating oil futures.